Investor Update Q3 & 9M FY17 - futureconsumer.in · Q3 9M FY16 Q3 9M FY17 5,015 12,715 Sales 5,473 15,699 33 107 Other Operating Income 43 125 5,048 12,822 Total Income from Operations

Investor Update Q3 & 9M FY17

Investor Update Q3 & 9M FY17 2

Disclaimer

This report contains forward-looking statements, which may be identified by their use of words like ‘plans’, ‘expects’, ‘will’,

‘anticipates’, ‘believes’, ‘intends’, ‘projects’, ‘estimates’, or other words of similar meaning. All statements that address

expectations or projections about the future, including but not limited to statements about the Company’s strategy for growth,

product development, market position, expenditures, and financial results are forward-looking statements. Forward-looking

statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these

assumptions and expectations are accurate or will be realized.

The Company’s actual results, performance or achievements could thus differ materially from those projected in any such

forward looking statements. The Company assumes no responsibility to publicly amend, modify or revise any forward looking

statements, on the basis of any subsequent developments, information or events.

Table of content

Business Overview

Integrated Food & FMCG Company

Q3 & 9M FY17 – At a Glance

Portfolio: Key Brands and Categories

Key Business Developments

Extending the Portfolio across Food & Beverages

Update on Food Park & Manufacturing Facilities

Distribution Network Spanning across Channels

Financial Update

FCL Initiated an era of FMCG 2.0

1

2

3

04-07

05

06

07

08-11

09

10

11

12-20

21-234

BUSINESS OVERVIEW

4

Investor Update Q3 & 9M FY17 5

Integrated Food & FMCG Company

Two Strong Pillars

of Business Purpose

Supporting the Furtherance

Sourcing & Manufacturing

Overall distribution footprint of ~29,000 stores

Access to a vast network of over 900 Future Group retail outlets

Extended Modern trade distribution at Lulu & Haiko

Strong presence in sourcing of agri commodities and fresh

produces

Dairy & Bakery manufacturing facility in Southern India

Frozen Vegetables / Snacks and Chutney facilities

Oats facility in Sri Lanka

International tie-up with global brands

Fo

od

& K

ey F

MC

G B

ran

ds

Distribution Network

Investor Update Q3 & 9M FY17 6

Q3 and 9M FY17- At a Glance

Brands like Karmiq (3.1x),

Kara (1.2x) Tasty Treat

(31%), Veg Affaire (61%)

exhibited strong growth in

9M FY17

EBITDA of INR 150 mn in

9M FY17 vs. loss of INR -

104mn in 9M FY16

Revenues of INR 15,824 mn

for 9M FY17 with top line

growth of 40.8%*

Welcoming FMCG 2.0, a

whole new way of looking at

an age-old industry

Extended distribution

footprint to Lulu and Haiko &

leveraging Nissin’s

distribution network

FCL largely remained

immune to demonetization

due to its focus on Modern

Trade

Launches include New Age

Namkeen, Exotic Dry Fruits

& Spinach in the frozen

foods category

Appointed Devendra

Chawla as the CEO of FCL

*Growth numbers on Like-to-like basis

Investor Update Q3 & 9M FY17 7

Portfolio: Key Brands and Categories

Food and Beverages (94%)

Home & Personal Care (6%)

Brands Staples, Dairy and Bakery, Fruits and Vegetables, Snacks, Juices, Frozen Foods, Ready to Cook

Foods among others

Wipes, Body Wash, Body Lotion, Toilet and Floor Cleaners, Kitchen Aides

Note:

1) Remaining 7% largely represents revenues from Food Park, Aadhaar and others.

8

KEY BUSINESS DEVELOPMENTS

Investor Update Q3 & 9M FY17 9

Extending the Portfolio across Food & Beverages

Karmiq’s new

launches add flavor

and color to and an

act of goodness to

your diet

Introduced an

Exotic Dry Fruit

Range: Dried

Cranberries,

Apricots, Prunes &

Dried Blueberries;

sourced from the

best locations

across the globe

Nilgiris launched 4

variants of flavored

Greek Yogurt –

Natural, Blueberry,

Strawberry &

Mango

Tasty Treat starting

a trend with the

Indo Western fusion

concept for snacks

Launched 4 new

exciting flavors of

the New Age

Namkeen:

Barbeque, Peri Peri,

Schezwan &

Wasabi

Veg Affaire

extended its frozen

food portfolio with

the launch of

Frozen Spinach

providing

convenience to

consumers looking

for speedy solutions

Fresh & Pure is a

manifestation of the

thought ‘From farm

to the Centre of the

Plate’

Extending its range

of tea with the

launch of ‘Kadak

Chai’

Investor Update Q3 & 9M FY17 10

Update on Food Park & Manufacturing Facilities

Sr No. Facility/ Particulars Capacity Status / Comments

1 Rice Mill 1.2 MT

Rice mill commisioned and leased to The Genoa Rice Mill Pvt Ltd for

operations.

Paddy procurement started

2 R&D Lab

A 11,000 sq ft Research & Development lab with an additional 3,000 sq ft

area available for future expansion

Facilities: i) Baking ii) Roasting & Coating iii) Dehydration iv) Blast

freezer etc.

Categories: i) Specialty flour ii) Sauces iii) Bakery iv) Biscuits v) Kettle

chips vi) Roasted nut units

3 Solar Power Project 1 MWRoof top solar pannel commisionned in Oct-16

Prouduced 97000KW in Dec-16

4 Avante - Kettle Chips Snacks Line expected to be completed by 21 February, 2017

5 IQF Facility Order for 200MT received covering many new varieties of vegetables

Investor Update Q3 & 9M FY17

Aadhaar, 4%

Nilgiris , 10%

Big Bazaar, 58%

EasyDay, 10%

Other MT & GT, 19%

11

Distribution Network Spanning across Channels

Note: Future Group stores include Heritage

** Represents split for Brand Business (93% of FCL topline)

Channel Wise

Sales**

FCL reaches over 295 million customers through Future Group outlets

To commence harnessing the distribution network of Nissin Foods to reach out to “kirana” stores

FINANCIAL UPDATE

12

Investor Update Q3 & 9M FY17 13

Performance Overview - Q3 FY17

(204)

(140)

Q3 FY16 Q3 FY17

PAT loss narrowed by INR 64 mn

159

121

Q3 FY16 Q3 FY17

Interest Expense Declined by INR 38 mn

5,048

5,516

Q3 FY16 Q3 FY17

Top Line Growth

24

62

Q3 FY16 Q3 FY17

EBITDA Improvement on the Back of High Growth and Efficiency

23%*

* Like to like growth, excluding impact of convenience stores franchised effective from Feb’16

Investor Update Q3 & 9M FY17 14

Performance Overview - 9M FY17

(781)

(509)

9M FY16 9M FY17

PAT loss narrowed by INR 272 mn

473

360

9M FY16 9M FY17

Interest Expense Declined by INR 113 mn

12,822

15,824

9M FY16 9M FY17

Top Line Growth

(104)

150

9M FY16 9M FY17

EBITDA Improvement on the Back of High Growth and Efficiency

41%*

* Like to like growth, excluding impact of convenience stores franchised effective from Feb’16

Investor Update Q3 & 9M FY17

Since 75% of the topline is driven by Modern Trade channels, FCL witnessed

limited impact of demonetization

On the other hand, Aadhaar was impacted by demonetization

75% of Fair Price Shop business is cash based

90% of Aadhaar’s business is wholesale and is cash only transactions

Wholesale F&V business witnessed a dip in sales due to demonetization

Shortage of cash led to a fall in selling price of fruits and vegetables

Demonetization impact has been neutralized since December 2016

Wholesale and Fruits & Vegetables businesses are reporting a steady

sequential growth

15

FCL Growth Reflects Impact of Demonetization

Investor Update Q3 & 9M FY17 16

Business Highlights

Food & Beverages witnessed

strong growth across brands

driving the overall top line

− Tasty Treat & Karmiq

launched gift boxes during the

festive season which received a

good response

− Veg Affaire continued to

register a strong YoY growth of

61%

F&V business has been shaping

up well with a robust growth of

159%

69%

Wheat + Oats Atta

Aadhaar reported a robust growth of 71% on YoY

basis

Expanded Fair Price Shops network to a total of 5,300 stores

66%

31%

3.1x

1.2x

Note: Growth numbers represent 9M FY17

Dec 31, 2016

2,194

Mar 31, 2016

1,693

Investor Update Q3 & 9M FY17

Q3 9M FY16 Q3 9M FY17

5,015 12,715 Sales 5,473 15,699

33 107 Other Operating Income 43 125

5,048 12,822 Total Income from Operations 5,516 15,824

4,312 10,909 COGS 4,734 13,634

736 1,913 Gross Margin 782 2,190

14.6% 14.9% Gross Margin% 14.2% 13.8%

13 54 Other Income 30 79

726 2,071 Other Operating Cost 750 2,119

24 -104 EBITDA 62 150

0.5% -0.8% EBITDA% 1.1% 0.9%

77 223 Depreciation 88 256

159 473 Interest Expense 121 360

-44 -156 Interest Income -34 -91

-167 -645 PBT -113 -375

1 1 Tax 0 7

-35 -135Share of JV, Associates & Minority

Interest-27 -126

-204 -781 Consolidated PAT -140 -509

-4.0% -6.1% PAT % -2.5% -3.2%

FY 2015-16Particulars (INR Mn)

FY 2016-17

17

Consolidated Income Statement – Q3 & 9M FY17

Reported a like to like growth of 23%

EBITDA Margins doubled to 1.1% in Q3 FY17 from

0.5% in Q3 FY16

Interest expense declined by ~INR 38 mn on YoY basis

PAT loss narrowed further by INR 64 mn

Note: Q3 & 9M FY16 includes convenience stores which were franchised in Feb‘16

Reported a like to like growth of 41%

EBITDA of INR 150 mn vs loss of INR 104 mn

Interest expense declined by ~INR 113 mn on YoY

basis

PAT loss narrowed further by INR 272 mn

Investor Update Q3 & 9M FY17 18

Evolution of Operating Profits

Going

forward

potential to

scale upPrior to 2016

reported

Operating Losses

Network expansion and

increasing penetration

Expansion of General

Trade network

New product launches

Premiumization of

products

Economies of scale

Currently achieving

profitability at

operating level

Investor Update Q3 & 9M FY17

31-Dec-16

Shareholder's Fund 9,348

Minority Interest -12

Net Debt 4,298

Net Adjusted Capital Employed 13,633

Fixed Assets 4,375

Goodwill and Intangibles 4,608

Non-Current Assets 1,113

Current Assets 5,902

Total Assets 15,998

Less: Non-Current Liabilities 690

Less: Current Liabilities 1,675

Total Net Assets 13,633

Particulars (INR mn)As on

19

Consolidated Balance Sheet (Proforma & Unaudited)

Balance Sheet is as per IND-AS

Debt reduction of INR 646 mn during

9M FY17

Investor Update Q3 & 9M FY17 20

India Food Forum Awards

Kosh Wins India Food Forum’s

Prestigious Food & Grocery

Innovation of the Year Award!

Devendra Chawla was awarded

the ‘Food & Grocery Professional of

the Year’

FCL INITIATED AN ERA OF FMCG 2.0

21

Investor Update Q3 & 9M FY17 22

Primarily focused on goods

Built to cater to yesterday’s consumers

Goods are not really fast moving

Shifting the focus towards consumers

Built on “Future Consumers”

FAST MOVING CONSUMER

GENERATION

Opportunity to lead the space

Investor Update Q3 & 9M FY17 23

FCL’s Journey Towards FMCG 2.0

Unprecedented retail success

Catering to the full spectrum of

consumers: Foodhall > Aadhar PDS

Expertise of Future Brands and Future

Ideas aiding innovative product

development

Future Consumer Limited delivering

products dedicated to the fast-moving

consumer

Developing brands by upgrading and

transforming a “branded commodity”

to a Genuine Brand

Communicating the brand vision

Building the organization via on

going initiatives of engaging with

consumer on various platforms and

through advertisements

3 2*Growth numbers on Like-to-like basis

Registered and Corporate Office:

Future Consumer Limited

Knowledge House, Shyam Nagar, Off Jogeshwari - Vikhroli Link Road,

Jogeshwari (East), Mumbai 400 060

: +91 22 30841300

: www.futureconsumer.in

Incase if any queries please contact: [email protected]

Thank

You